Gold hovers near two-year low as rate-hike fears persist


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Gold prices hovered near a two-year low

on Friday and were set for a weekly fall as an elevated dollar

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and prospects of aggressive U.S. rate hikes dented bullion’s

appeal.

FUNDAMENTALS

* Spot gold was unchanged at $1,664.48 per ounce, as

of 0030 GMT, and was down 3% for the week so far. Prices hit its

lowest since April 2020 at $1,659.47 on Thursday.

* U.S. gold futures were down 0.3% at $1,673.10.

* The dollar index was headed for a weekly gain. A

stronger greenback makes gold expensive for overseas buyers.

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* Gold is considered an inflation hedge but rising interest

rates increase the opportunity cost of holding the non-yielding

asset.

* U.S. retail sales unexpectedly rebounded in August, but

demand is cooling as the Federal Reserve aggressively raises

interest rates to fight inflation. Separate data showed U.S.

weekly jobless claims fell last week.

* India has slashed the base import prices of gold, palm

oil, and crude soya oil, the government said in a statement late

on Thursday.

* Meanwhile, holdings of SPDR Gold Trust , the world’s

largest gold-backed exchange-traded fund, rose 0.15% to 962.01

tonnes on Thursday from 960.56 tonnes on Wednesday.

* Spot silver dipped 0.7% to $19.01 per ounce.

Platinum fell 0.5% to $900.36 and palladium was

down 0.2% at $2,132.49.

DATA/EVENTS (GMT)

0200 China Urban Investment YY Aug

0200 China Retail Sales YY Aug

0200 China Unemp Rate Urban Area Aug

0600 UK Retail Sales MM YY Aug

0600 UK Retail Sales Ex-Fuel MM Aug

0900 EU HICP Final MM YY Aug

1400 US U Mich Sentiment Prelim Sep

0930 ECB President Christine Lagarde and Bank of France

Governor Francois Villeroy de Galhau talk in an event, “20 ans

de l’euro,” organized by Banque de France in Paris

(Reporting by Ashitha Shivaprasad in Bengaluru; editing by

Uttaresh.V)



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